Court File and Parties
COURT FILE NO.: CV-22-89313
DATE: 2023/08/18
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Sylvain Bacon, Plaintiff
AND
Anthony Zuccarini, Defendant
BEFORE: The Honourable Justice C. T. Hackland
COUNSEL: Christine Muir and Samantha Bonnano, for the Plaintiff
Pierre Champagne and Justin Tremblay, for the Defendant
HEARD: Tuesday, May 16, 2023, Ottawa (by Zoom videoconference)
ENDORSEMENT (Motion Rule 30.1.01)
[1] The defendant moves for an order staying this defamation action because it is based on evidence obtained by the plaintiff in circumstances the defendant says contravened the deemed undertaking rule, as codified in Rule 30.1.01 of the Rules of Civil Procedure.
[2] The defendant in this action Anthony Zuccarini is involved as a defendant in another proceeding in this court in which his siblings, as plaintiffs, allege that he exercised undue influence on their parents to disinherit his siblings and divert the parent’s large estate to himself. One of the siblings, his brother John, is married to Sylvain Bacon, the plaintiff in the present proceeding. Mr. Bacon is not involved in the Zuccarini family litigation. However, in the Zuccarini family proceeding Anthony swore a lengthy affidavit defending against allegations that he improperly influenced his parents in a series of business transactions. In support of his position Anthony exhibited to his affidavit an audio recording of an interview he had with his parent’s former accountant and a separate interview with their former lawyer. The recordings were made surreptitiously, unknown to either of these professional advisors.
[3] These recorded conversations discuss commercial transactions involving his parents, which had been carried out with the advice and participation of these two professionals. At one point in each of the recorded conversations Anthony makes a pejorative reference to his brother John’s spouse Sylvain Bacon having made money from insider trading. This seems to be a very brief remark seemingly unconnected to the matters under discussion and unconnected to anything to do with the Zuccarini family litigation. This affidavit has not yet been filed in court in the family lawsuit, at this point in time, however John Zuccarini was provided with a copy, presumably through his counsel. John apparently disclosed the affidavit and attached recordings to his spouse Sylvain Bacon, the plaintiff in the present proceeding. Mr. Bacon subsequently retained counsel, alleged defamation against Anthony Zuccarini and demanded a retraction of the insider trading comment. When this was not forthcoming in a timely way, Mr. Bacon commenced this action
[4] It is the defendant Anthony Zuccarini’s position that Mr Bacon’s defamation action herein violates the common law implied undertaking rule and the statutory deemed undertaking rule in Rule 30.1.01 of the Rules of Civil Procedure. The plaintiff, Mr. Bacon submits in response that this rule does not apply in circumstances where a party voluntarily appends exhibits to an affidavit tendered as evidence in another proceeding. Rather, the objective of the rule is to protect the use to which the compelled production of a party's private information can be put.
[5] In the court’s view, the plaintiff’s position is correct on this point and is supported by the case law and Rule 30.1.01 has no application.
[6] Rule 30.1.01 of the Rules of Civil Procedure provides:
Application
30.1.01 (1) This Rule applies to,
evidence obtained under,
Rule 30 (documentary discovery),
(ii) Rule 31 (examination for discovery),
(iii) Rule 32 (inspection of property),
(iv) Rule 33 (medical examination),
(v) Rule 35 (examination for discovery by written questions); and
(b) information obtained from evidence referred to in clause (a).
(2) This Rule does not apply to evidence or information obtained otherwise than
under the rules referred to in subrule (1).
Deemed Undertaking
(3) All parties and their lawyers are deemed to undertake not to use evidence or
information to which this Rule applies for any purposes other than those of the
proceeding in which the evidence was obtained.
Exceptions
(4) Subrule (3) does not prohibit a use to which the person who disclosed the
evidence consents.
(5) Subrule (3) does not prohibit the use, for any purpose, of,
evidence that is filed with the court;
evidence that is given or referred to during a hearing;
information obtained from evidence referred to in clause (a) or (b).
(6) Subrule (3) does not prohibit the use of evidence obtained in one proceeding,
or information obtained from such evidence, to impeach the testimony of a
witness in another proceeding.
(7) Subrule (3) does not prohibit the use of evidence or information in
accordance with subrule 31.11 (8) (subsequent action).
Order that Undertaking does not Apply
(8) If satisfied that the interest of justice outweighs any prejudice that would
result to a party who disclosed evidence, the court may order that subrule (3)
does not apply to the evidence or to information obtained from it, and may
impose such terms and give such directions as are just.
[7] I respectfully agree with and adopt the following submission from the plaintiff’s factum, which accurately summarizes the position of the Ontario Court of Appeal in the leading case of Kitchenham v. AXA Insurance (Canada), 2008 ONCA 877 at paras 34 and 37:
The deemed undertaking rule set out at Rule 31.1.01(3) applies only to evidence or information obtained from evidence secured through discovery mechanisms. For greater certainty, rule 31.1.01(1) explicitly sets out that the rule applies to evidence obtained under Rules 30, 31, 32, 33, and 35, and information obtained from that evidence.
[8] It can be seen that none of the Rules listed therein pertain to evidence voluntarily put forward by way of affidavit on a motion. For greater certainty, rule 31.1.01(2) further states that the rule does not apply to evidence or information otherwise obtained than under the rules referred to in subrule (1).
[9] As the defendant Anthony Zuccarini was not compelled through the discovery process to attach and subsequently produce the surreptitious recordings that he had made of discussions with the two professional advisors, he is not entitled to avail himself of the deemed undertaking rule.
[10] The moving party, Mr. Zuccarini, seeks to rely on the case of Longo v. Tricom Security Services, 2020 ONSC 4160 in which Lococo J. ruled that the deemed undertaking rule applied to prevent a plaintiff from using a security video in aid of a criminal prosecution. The video had been previously voluntarily provided by defendant’s counsel to plaintiff’s counsel prior to commencement of a civil action for assault. Central to the court’s reasoning however was that the video was a key piece of evidence in the civil case and would inevitably be necessarily included in the defendant’s affidavit of documents. Therefore, it was produced in accordance with a compulsory requirement, notwithstanding its production preceded service of the defendant’s affidavit of documents.
[11] I would distinguish Longo on the basis that in the present case it can not be said that the portion of the recording constituting the alleged defamation was central or even relevant to the issues in the Zuccarini family litigation and may well not be included in Mr. Zuccarini’s affidavit of documents in that proceeding. Therefore, the recording was not produced in accordance with a compulsory requirement and instead was a voluntary inclusion in Mr. Zuccarini’s affidavit, governed by Rule 39 and not giving rise to the deemed undertaking at common law or under Rule 30.1.01.
[12] The defendant brings to the court’s attention that he has voluntarily taken steps to alleviate the plaintiff’s concerns pertaining to the allegedly defamatory remark he made on the two recordings appended to his affidavit in the Zuccarini family proceeding. He has redacted his affidavit to remove the portion alleged to be defamatory. He advises this was done with the consent of the lawyers for the siblings in the Zuccarini family litigation and, if the affidavit is ever required to be filed in court, he undertakes that only the redacted version would be filed. Moreover, he has delivered a letter to the two professionals who were privy to the exchange he recorded, retracting his statement about Mr. Bacon and apologizing for any implication of improper conduct that these statements may have caused.
[13] I note that these steps recently taken were essentially the same steps demanded by counsel for Mr. Bacon as a condition of not commencing an action. Mr. Zuccarini was not agreeable to doing so prior to this action being commenced.
[14] The defendant submits that given the remedial steps he has now taken that should alleviate any concerns Mr. Bacon may have about injury to his reputation as well as the improper manner by which Mr Bacon obtained the recording, the court should find the action to be vexatious and an abuse of process and should stay the action.
[15] For the reasons stated above, I decline to find that the plaintiff has contravened the deemed undertaking rule, although obtaining the recordings from his spouse, a party to the Zuccarini family proceeding, was of questionable propriety. Further, the defendant has, perhaps belatedly, taken all reasonable steps to prevent or at least substantially mitigate any damage to Mr. Bacon’s reputation, if indeed there ever was any such damage.
[16] I dismiss the defendant’s motion to stay the action on the deemed undertaking ground. The court lacks the evidentiary basis at this point to conclude the action is vexatious. The defendant’s motions are dismissed.
[17] This is not a case in which costs should be awarded to either party. This case cries out for resolution and the application of common sense. This is currently a Rule 76 case, which I suggest the parties agree to have transferred to Small Claims Court.
Justice Charles T. Hackland
Date: August 18, 2023
COURT FILE NO. CV-22-89313
DATE: 2023/08/18
ONTARIO
SUPERIOR COURT OF JUSTICE
RE: Sylvain Bacon, Plaintiff
AND
Anthony Zuccarini, Defendant
COUNSEL: Christine Muir and Samantha Bonnano, for the Plaintiff
Pierre Champagne and Justin Tremblay, for the Defendant
ENDORSEMENT
(MOTION RULE 30.1.01)
Justice Charles T. Hackland
Released: August 18, 2023